Attom has unveiled its list of the U.S. housing markets with the largest quarterly profit margin increases for home sellers, as determined by its recently released Q3 2023 U.S. Home Sales Report.
All of the cities topping the list are small and midsized metros east of the Mississippi — led by Scranton, Pennsylvania, which boasted a whopping 92% profit margin on median-priced single-family home and condominium sales. That’s up from a margin of 72.2% in Q2 2023, an increase of 19.8 percentage points. The Keystone State was also home to the city with the second-highest profit margin jump: In Reading, the 88.5% profit margin in Q3 was up from 70.3% in Q2, a gain of 18.2 percentage points.
Flint, Michigan, was third with a quarterly gain of 17.9 percentage points (going from 66.7% to 84.6%) and was followed by Evansville, Indiana, at 13 points (32.9% to 45.9%) and Roanoke, Virginia, at 11.9 points (44.4% to 56.3%). Rounding out the top 10 were Syracuse, New York (51.1% to 62.4%); Kalamazoo, Michigan (67.8% to 77.7%); Birmingham, Alabama (41.2% to 50.9%); Lansing, Michigan (50.1% to 59.6%); and Salisbury, Maryland (48.7% to 57.9%).
Each city in the top 10 had a gain that dwarfed the national increase in residential seller profit margins. Profit margins on median-priced single-family home and condo sales nationwide rose to 59% in the third quarter, up from 56.6% in the second quarter and good for an increase of 2.4 percentage points. Fifty-five percent of metro areas evaluated by Attom saw profit margins grow on a quarterly basis, although 66% of these metros still posted an annualized decline.
It’s worth noting that the profit-margin increase from the second to third quarters was the second consecutive quarterly gain following an unusual slide from mid-2022 to early 2023.
Profit margins have been increasing after the dearth of resale stock ignited an increase in median home prices. Gross profits on typical single-family home and condo sales nationwide grew to $129,900 in the third quarter, up 5% quarterly and up 3.2% annually, Attom reported.